No matter how you use rates at your agency - by staff, role, or service - you will need to have at least one Rate Category in your FP system. Your base system will come with one in place for you, that can be edited or replaced. Please review this article to learn how to set up additional Rate Categories in your system.
What Are Rate Categories?
Rate Categories, sometimes called rate cards, are a grouping of rates for all Services by which you bill your customers. For example, you may have a "Standard Rate" where copywriting is $125/ hour, design is $150/ hour and research is $90/ hour. You might also have a "Discount Rate" where copywriting is $85/ hour, design is $100/ hour and research is $75/ hour.
When creating an Estimate in the system, you will need to pick a Rate Category.
You will also see the option to pick a Rate Category at the Company level. Picking an Rate Category here, will mean that when we go to make an Estimate for this Company, the Rate Category will be pre-selected.
Adding a New Rate Category
You can create as many Rate Categories as you like. From the main navigation bar, choose Admin > Rate and Staff Management > Rate Categories.
Note that access to the Admin area is permission based. Speak to your in-house FP administrator if your permissions need to change.
You will land on the Manage Rate Categories page. Here, we can see our current categories, and we have the ability to create new ones. Let's create a rate for clients who want last minute work done. Fields marked in blue are required:
- Type in a name for this new rate and optionally add in any description. This description would only be seen by your internal users - it would not display on Estimates or Invoices.
- Enter default costs and mark-up. These will apply to any new Expenses and Services that you create after the creation of this Rate Category. You will still be able to change these values, but these defaults will be in place to save you time.
- By default, new rates you add will be already marked as Active - meaning you can use them for creating new work immediately. Un-check the Active box as needed.
- Choose to make this rate your Cost Rate - aka, what it costs you to provide this work. To learn more about cost rates, please review this article: Setting Individual Staff Costs & Creating Cost Rate Card. You can also choose to make this rate the Default Rate. Meaning that this rate will be selected when you create new work in your system. You will be able to make a different selection as needed.
- Choose to make this Rate Category be the one used by default when creating new work in your system.
Click Save when ready.
Once you save your changes, the new Rate Category will appear in your list. To edit this rate, or any other, click on the name, and the top portion of the screen will populate and be editable.
Enter the Rate Values Across Your Services & Expenses
From the Admin menu choose Rate and Staff Management > Service Rates & Markups.
All your Internal Services ($$/ hour), Internal Expenses ($$/ units sold) and External Expenses (percentage mark-ups) will be listed here, along with any of your active Rate Categories. Leave the default rate and mark-up values, or type in other values of your choice. Click Save (bottom of the page) when done.
Added Step - For Clients Using Role Rates
From the Admin menu choose Rate and Staff Management > Role Rates.
Remember that to build estimates based on role rates, each staff member need to be assigned a role, and you will need to set the System Preference to use role rates.To learn more, please review this article: Setting up Role Rates
You will land on the Manage Role Rates page. The newly created rate will be listed here, along with each active Role in your system. The default value will show. Enter what the hourly rate should be for each Role - if different from the default. And make sure to select the Save & Carry To All Staff button to populate the Role Rates for each of your staff.
Note that if you want to add or edit the Role options, you can do so via Admin > System Set Up > List Maintenance.
Added Step - For Clients Using Staff Rates
From the Admin menu choose Rate and Staff Management > Staff, Staff Rates and Permissions.
Remember that to build estimates based on staff rates, you will need to set the System Preferences appropriately.To learn more, please review this article: Setting Up Staff Rates
You will land on your Admin Staff List. From the list, click on the Rate button for any staff member.
The new Rate Category we created is listed here. On any line, the rate in brackets will be used when this person tracks time to a Job that is using this Rate. Unless an alternate amount in entered into the blank field on that line. In the example above, if Natasha tracks time to Design, on a Job using the Rush Rate, the hourly billable value of those Timesheets will be $155.
Now however, should we save this change, if Natasha tracks time to Design, on a Job using the Rush Rate, the hourly billable value of those Timesheets will be $140. Remember the bracketed value will be used unless there is another value in the non-bracketed field. Be mindful to NOT put $0 into any non-bracketed field, as that will result in this staff person having zero dollar/hour Timesheets.
Choose to make changes for any other staff members, just by choosing their name on the right hand side. Optionally choose to use the top row, to add sweeping Staff Rates over an entire Rate Category. Be sure to save your changes - the Save button will be in the bottom right of the page.
Last Step - Ensure All is Set-Up for Invoicing
If you use FP to generate invoices, you will want to take this last step. This step will ensure that you can create work using your new Rate Category, as well as Invoice for work that uses that new Rate Category.
From the Admin menu, choose Integrate Accounting > Assign Accounts.
Note that you will not need to take this step if you are using the FP Accountant tool, and you are integrating with the desktop or online versions of QuickBooks.
Here we can see all our active Rate Categories, as well as the newly created one. The newly created one will need to have income or expense accounts from your Chart of Accounts, assigned to each Service and Expense you offer.
For each blank field, type in part of the account name, or copy and paste from another field on this page, or click the magnifying glass to choose from a list of available options.
Save your changes when done. The Save Changes button is in the bottom right of the page.
Without this information being added in, you will encounter the dreaded box of shame when you try to invoice for work that has been created using this new Rate Category.
You can make a selection on the fly within the invoice, but it is probably easier, and will probably make your bookkeeper happier, to have these associations set up ahead of time, and remain set.
We hope you'll find setting up Rate Categories to be a straightforward process. Please reach out with your questions or concerns: email@example.com